Judge rejects Skunk Train owner’s claim it is a public utility with right of eminent domain
A Mendocino County man who spurned the owners of the Skunk Train when they tried to force him to sell them his land has prevailed in a grueling three-year legal brawl that left him saddled with debt.
At issue was whether Mendocino Railway, operator of the popular excursion train, is a public utility with the right to take property through eminent domain and whether, in its effort to buy 20 acres from a man named John Meyer, it attempted to do so in order to serve the public good or it own private interests.
In deciding the case in Meyer’s favor, Mendocino County Superior Court Presiding Judge Jeanine Nadel delivered a punishing blow to Mendocino Railway, chipping away at its claims to hold power above and beyond most private companies and potentially undermining its position in several unsettled cases.
The closely watched court case has potential implications for other controversies in which the company is embroiled.
For Meyer, whose victory has put him on the receiving end of congratulations, it remains difficult to feel the fight is over after a grueling, three-year legal brawl that left him in substantial debt.
The plans for his 21 acres on the outskirts of Willits have been on hold for three years, and his partners have moved on. Construction costs, meanwhile, have risen so dramatically that development costs have doubled, he said.
“It’s been a nightmare,” said Meyer, 50.
“It’s been worse than limbo,” he said. “I guess limbo is between Heaven and Hell. I’d be closer to the Hell side.”
Though he expects a final judgment will include reimbursement of attorneys’ fees — now “in the neighborhood of $250,000” — he doesn’t know when that might come or how an appeal might affect it. In the meantime, the fact that action is still pending against his land blocks him from borrowing money for development. He’s behind on his mortgage, as well.
“I have literally put everything I own on it,“ Meyer said. ”I’m still in a horrible position.“
Judge questions CEO’s credibility
In her ruling, the judge directly questioned the credibility of Mendocino Railway President and Chief Executive Officer Robert Pinoli, the only witness. She noted that initial plans for the property included a train station, as well as a campground and long-term RV rental park that did not satisfy the three-part test for use of eminent domain, which allows its exercise only in the public interest and when the land is required for a given project “compatible with the greatest public good with the least private injury.”
Mendocino Railway has become entangled in several high-stakes issues in recent years, including the future of the Great Redwood Trail planned for former North Coast Railroad tracks from Cloverdale to Humboldt Bay.
The railway also is in litigation with Fort Bragg and the California Coastal Commission over its rejection of their attempts at land-use regulation, pursuing relief along two tracks in U.S. District Court, in hopes of securing a declaration it does in fact hold public utility status.
The railway claims it stands apart from most business interests — exempt from many common land-use permit requirements and able to acquire land through eminent domain — despite statements from the California Public Utilities Commission as recently as August saying that the commission’s regulation of the Skunk Train for safety reasons doesn’t make it a public utility.
The railway also over the past five years has acquired about 375 acres of mostly undeveloped coastal property in Fort Bragg with the potential to transform the seaside town, once anchored by a defunct Georgia-Pacific lumber mill, which sprawled across the same site.
Much of the mill site was purchased under the threat of eminent domain, an authority Nadel’s ruling has now brought into question. In it, she cited insufficient evidence to demonstrate the railway was a “public utility” with the power to condemn land — “the central issue in this case,” according to her April 19 ruling.
West Sonoma County resident Caryl Hart, chair of the Great Redwood Trail Agency Board of Directors and vice chair of the California Coastal Commission, has followed the Meyer case, given multiple points of common interest. She also has a law degree.
The ruling against Mendocino Railway “is very damaging,” Hart said.
Nadel still has to deliver a final judgment in the case. Mendocino Railway also may appeal the ruling.
Pinoli, the president and CEO, said the railway was “in the process of determining our next steps.”
Nadel’s decision, he said, “seems to not take evidence and facts into account.”
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